Security consultancy Pentura is phasing out its traditional resale activities after claiming that the margins inherent in the model have become untenable.
Pentura will now supply product only if it is off the back of a consultancy sale and the realignment has led to the loss of five jobs. It will continue to honour related maintenance contracts.
Pentura managing director Steve Smith said the Reading-based outfit will now focus on three core consulting areas: penetration testing, governance, risk and compliance and data security.
"Products will still feature but we are now a consultancy and services-led business," he confirmed.
Smith said margins had slumped to below 10 per cent on some large deals as a result of the aggressive tactics of global SIs that have recently acquired their way into the security channel.
"In the past 18 months, the traditional reseller market has been difficult for us, particularly as we focus on large enterprise clients," said Smith.
"If it goes below 25 per cent, I want to know why as we are used to 30 to 35 per cent. Clients were coming to us and asking for single digits as they were getting that from the SIs. We do not want to compete on those margins."
Pentura hit turnover of nearly £9m last year but Smith said the firm is now focused on profit rather than revenue. The realignment follows the launch of its consultancy arm last year.
"We saw revenue drop last year because of the focus on and success of our consulting business," he said.
Smith hinted the refocus could also affect its vendor line-up. "We are finding our feet with which vendors fit well," he said. "We work with Symantec and Varonis in DLP and we are still hugely behind that."
Anthony Perridge, EMEA channel director at Sourcefire - which is one of Pentura's largest vendor partners - said it was a "sound strategy".
"I am sure Sourcefire will continue to work closely with Pentura, as our solutions do require services," he said. "On the back of the services there will still be product sales.
"Certainly there has been a squeeze on margins and the Sourcefire channel programme does a lot to protect the partners from that. Pressure on channel margin is often driven by the end users as they look to reduce costs and the number of suppliers. This can play to the strengths of the global SIs."
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